The African Development Bank (ADB) has signed a $15 million Trade Finance Transaction Guarantee Facility with Zimbabwe’s NMB Bank aimed at unlocking trade finance opportunities for small and medium-sized enterprises, as well as agri-business and trade distribution value chains in the country.
At the signing ceremony held at the NMB Bank Headquarters in Harare, ADB Country Manager for Zimbabwe, Moono Mupotola, signed on behalf of the Bank while NMB Bank Chief Executive Officer, Gerald Gore, signed on behalf of the bank.
Speaking shortly after the brief ceremony, Mupotola said the African Development Bank’s board had earlier approved the project in November 2023, with the facility offering up to 100% coverage to confirming banks, effectively mitigating non-payment risks linked to NMB Bank’s trade transactions on a per-transaction basis.
“It is tailored to support trade between Zimbabwe and other African countries and with overseas markets by significantly diminishing the risk for international financial institutions actively engaging in trade finance activities with Zimbabwean businesses,” Mupotola said.
“The African Development Bank is committed to supporting the development of the private sector in Zimbabwe. This is a significant step forward in supporting the growth and competitiveness of Zimbabwean businesses.
“By mitigating risk and facilitating access to trade finance, we are empowering SMEs and local corporates to participate more actively in regional and international trade,” she said.
Also speaking, Gore emphasized the agreement’s importance for Zimbabwe’s economic development.
“This facility will be instrumental in enabling NMB to provide crucial trade finance support to a wider range of Zimbabwean businesses. This will not only unlock new trade opportunities but also contribute to job creation and economic growth.
“SMEs often face challenges in accessing trade finance compared to their larger counterparts. This initiative directly addresses this gap, fostering a more vibrant and inclusive business environment in Zimbabwe,” Gore said.